TO: ALL PERSONS WHO RENTED A VEHICLE IN NEW JERSEY FROM ELRAC, INC.
DOING BUSINESS IN BERGEN, ESSEX, HUDSON, HUNTERDON,
MIDDLESEX, MONMOUTH, MORRIS, OCEAN, PASSAIC, SOMERSET,
SUSSEX, UNION, OR WARREN COUNTY AS ENTERPRISE RENT-A-CAR
("ELRAC") AND PURCHASED SUPPLEMENTAL LIABILITY PROTECTION
("SLP") AND/OR PERSONAL ACCIDENT INSURANCE ("PAI") FROM
APRIL 1, 1988 THROUGH JULY 30, 1993 OR FROM NOVEMBER 1, 1999
THROUGH MARCH 11, 2003 AND/OR COLLISION DAMAGE WAIVER ("CDW")
FROM APRIL 1, 1988 THROUGH MARCH 11, 2003, AND WHO DID NOT
EXCLUDE THEMSELVES FROM THE CLASS ("CLASS MEMBERS").
THIS IS A LEGAL NOTICE THAT MAY AFFECT YOUR RIGHTS
YOU HAVE NOT BEEN SUED
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. YOUR
RIGHTS TO PARTICIPATE IN OR OBJECT TO A PROPOSED SETTLEMENT OF
THE LITIGATION LISTED ABOVE MAY BE AFFECTED.
1. Purpose of Notice. This Notice has been sent to you because you are or may be a
member of the class of persons whose rights are being determined in this action. A proposed
settlement of this litigation has been reached. Pursuant to Rule 4:32 of the New Jersey Court
Rules and an order of the Court listed above, this notice will inform you of the terms of the
proposed settlement of this class action litigation and of the Hearing (as defined below) to be
held by the Court to consider the fairness, reasonableness, and adequacy of the settlement.
This notice describes the rights you may have in connection with the settlement and what steps
you may take in relation to the settlement of this class action litigation.
2. Background. The class action lawsuit referenced above is presently pending in the
Superior Court of New Jersey, Ocean County, Law Division. A class action is a lawsuit in
which one or more persons sue on behalf of all other persons in a similar situation. The lawsuit
alleges that from April 1, 1988 through July 30, 1993, and from November 1, 1999 through
February 29, 2000, ERACC and/or ELRAC sold Supplemental Liability Protection ("SLP")
and Personal Accident Insurance ("PAI") in the State of New Jersey without proper licensure or
registration and used rental agreement forms and related sales practices that misled customers
into buying SLP, PAI and/or Collision Damage Waiver ("CDW").
Specifically, the lawsuit alleges:
(a) ERACC and/or ELRAC sold SLP and PAI in New Jersey without
having the proper New Jersey insurance licenses (i.e., registration) to
sell insurance; and
(b) To induce renters to buy SLP, ERACC's and/or ELRAC's rental
agreements uniformly misrepresented that "Enterprise Supplies No
Insurance," when, in fact, ERACC and/or ELRAC supplied the
third-party insurance required by New Jersey's minimum financial
responsibility law; and
(c) To induce renters to buy SLP, PAI and CDW, ERACC's and/or ELRAC's
rental agreements uniformly misrepresented or failed to disclose that
ERACC and/or ELRAC knew that these products were actually or likely
duplicative of insurance that renters already had through other sources,
such as their personal auto insurance policies or the credit cards that they
used to rent from ERACC and/or ELRAC.
ERACC and ELRAC have denied any wrongdoing and also deny that the case should proceed
as a class action, except for purposes of this settlement.
Specifically, ERACC and ELRAC contend that:
(a) ERACC did not rent vehicles or sell SLP, PAI or CDW in the State of
New Jersey, but instead operated in New Jersey through its wholly
owned subsidiaries such as ELRAC; and
(b) ELRAC is and was properly licensed as required by law and that ELRAC
did not violate New Jersey insurance licensure laws in selling SLP and
PAI in New Jersey; and
(c) ELRAC's rental forms and other materials accurately inform renters
about the optional products, and ELRAC does not sell SLP, PAI and
CDW in a deceptive manner; and
(d) The phrase "Enterprise Supplies No Insurance" is accurate and not
misleading because ELRAC does not, nor does New Jersey's minimum
financial responsibility law require ELRAC to, provide insurance to
renters; and
(e) SLP, PAI and CDW provide valuable protection to all renters who choose
to purchase the products, even if renters have additional protection.
No trial has been held on the merits of any of the claims. This Notice does not imply that there
has been any finding of any violation of the law by ERACC and/or ELRAC or that recovery
could be had in any amount. This Notice is directed to you because your rights may be affected
by the proposed settlement. If the proposed settlement does not become final, the lawsuit will
proceed as if there had been no proposed settlement.
3. History of the Litigation. This class action was initiated by Plaintiff Michael
Delaney in this Court on April 5, 2001, alleging the claims described above against ERACC
and ELRAC. Both ERACC and ELRAC moved to dismiss Plaintiff's Complaint, which the
Court denied.
Thereafter, the parties conducted a substantial amount of discovery into the facts
underlying this case. That discovery included the review of thousands of pages of documents
supplied by ERACC and ELRAC, more than 20 individual and/or corporate representative
depositions of the Defendants and of a third party insurer and consultant, and numerous
interrogatory and request for admission answers from the Defendants.
During the course of this discovery, Plaintiff filed his motion for class certification.
ERACC and ELRAC opposed that motion, and filed a motion to dismiss claims prior to
April 5, 1995 on statute of limitation grounds. The Court resolved these motions by dismissing
some but not all of the Plaintiff's claims for periods prior to April 5, 1995, and certifying the class
as to the remaining claims.
Specifically, the Court certified a class of all persons and entities (a) who/which
purchased SLP and/or PAI in the State of New Jersey from or through ERACC or ELRAC at
any time from April 1, 1988 through March 11, 2003, except for the period July 31, 1993
through October 31, 1999, and/or (b) who/which purchased CDW in the State of New Jersey
from ERACC or ELRAC at any time from April 1, 1988 through March 11, 2003. The Court
ordered that published and certain mailed notice of the pendency of that certified class action
and the opportunity for exclusion from the class be given to class members. The notice was
disseminated by September 5, 2003 with an exclusion request deadline of October 25, 2003.
Following certification of the class, Plaintiff moved for summary judgment in favor of
the class only as to the illegal contract (Count I) and New Jersey consumer fraud (Count II)
claims relating to licensure or registration. ERACC and ELRAC opposed that motion and
cross-moved for summary judgment seeking to dismiss the same licensure or registration
claims. On December 1, 2003, the Court resolved both motions by dismissing the illegal
contract claim (Count I) and denying both motions as to the consumer fraud claim (Count II),
finding that there are questions of fact as to whether the Defendants' lack of registration
constitutes a cognizable consumer fraud violation. ERACC and ELRAC requested leave to
appeal that decision, which request has been dismissed without prejudice to renewal should the
proposed settlement not be finally approved.
On December 16, 2003, ERACC and ELRAC filed another motion for summary
judgment. That motion seeks dismissal of the misleading sale claims, asserting that Defendants
owed no duty to disclose to their customers the terms of the agreements between customers and
third parties. ERACC and ELRAC have advised that should this litigation continue they intend
to file other motions for summary judgment on the misleading sale claims.
The parties from time to time throughout this litigation have discussed the possibility of
settlement. Following the Court's summary judgment ruling on the licensure and registration
claims and the filing of Defendant's newest summary judgment motion as to the misleading sale
claims, the parties renewed their settlement discussions. After meeting in January, 2004, the
parties agreed to attempt to mediate a resolution of this class action through a court-appointed
mediator. The Court appointed as mediator retired Superior Court Judge L. Anthony Gibson
before whom the parties participated in two mediation sessions resulting in this proposed
settlement.
As part of the proposed settlement, Plaintiff filed an Amended Complaint on
May 18, 2004 to add claims against ELC for a class of persons and entities who/which
purchased SLP and/or PAI from ELC from April 1, 1988 through July 30, 1993 and
November 1, 1999 through February 29, 2000. ELC is another ERACC subsidiary that rents
vehicles in New Jersey and whose alleged conduct and practices were materially similar to
ELRAC with regard to SLP and PAI.
The parties believe that this proposed settlement is appropriate in order to avoid the
expense, inconvenience, and burden of further litigation particularly in light of the benefits
that the class members and potential class members will receive as a result of this proposed
settlement. Class Counsel believes that these benefits provide significant value to the members
of the Class and that the proposed settlement is a fair, reasonable and adequate resolution of
this class action.
4. Terms of the Proposed Settlement. a. The proposed settlement affects all members of the "Settling Class." You
are a member of the Settling Class if:
You purchased one or more of these products
from ELRAC in the State of New Jersey | Between and including the dates |
| SLP | 04/1/88 and 7/30/93; or 11/1/99 and 02/29/00 |
| PAI | 04/1/88 and 7/30/93; or 11/1/99 and 02/29/00 |
AND you did not submit a claim for which benefits were paid under SLP or PAI;
AND you were not an employee, agent or representative of ELRAC or any of the
insurance companies for which ELRAC sold SLP or PAI in the State of New Jersey at
the time of purchase;
AND you did not exclude yourself from the class on or before October 25, 2003.
b. If the settlement is approved, each member of the Settling Class will be
entitled to receive one "Discount Certificate" for a future rental for every rental transaction in
which he or she purchased PAI and/or SLP during the applicable time period. Each Discount
Certificate shall be usable at any of ELRAC's branches for a future rental of up to 30 days in
length. The Discount Certificate will provide for the following:
- If the future rental is of a standard vehicle or less, a discount equal to
50% of the undiscounted daily retail rate for the class of vehicle rented,
plus a one-class upgrade if desired; or
- If the future rental is of a vehicle that is one class above standard, a
discount equal to 50% of the undiscounted daily retail rate for a
standard vehicle; or
- If the future rental is of a vehicle that is two or more classes above
standard, a discount equal to 50% of the undiscounted daily retail rate
for a vehicle that is one class above standard.
The Discount Certificate will be redeemable for a rental beginning within one year from the
date of issue and will be fully transferable to anyone, provided it is used by a qualified renter.
The discount offered by each Discount Certificate has been determined by Class Counsel's
expert to be worth on average at least $97.58.
c. In return, all of the Settling Class Members' claims arising from or
relating to the purchase of SLP and/or PAI from ELRAC in the State of New Jersey from
April 1, 1988 through July 30, 1993 or from November 1, 1999 through February 29, 2000 are
dismissed with prejudice and all members of the Settling Class are forever barred from any
future litigation asserting those or related claims.
d. The Discount Certificates will be automatically mailed to members
of the Settling Class who purchased SLP and/or PAI from November 1, 1999 through
February 29, 2000 without any need for those Class Members to submit claims.
e. Settling Class Members who purchased SLP and/or PAI from
November 1, 1999 through February 29, 2000 who have changed their address may call
1-800-331-4352 to ensure that the Discount Certificate is mailed to their new address. When
you call the number, you will be asked to state your name, the address you listed on your most
recent rental agreement, and the address where the Discount Certificate should be mailed.
f. Settling Class Members who purchased SLP and/or PAI from April 1,
1988 through July 30, 1993 must properly fill out and submit the attached "Proof of Claim"
form to the address listed on that form, postmarked on or before October 8, 2004. To properly
fill out the "Proof of Claim" form, you must verify under oath: (i) that you rented during the
applicable time period; (ii) the number of times you rented from April 1, 1988 through
July 30, 1993 and also purchased SLP and/or PAI; and (iii) that you are submitting copies of
all documents you currently have in your possession evidencing the claimed rentals. DO NOT
SUBMIT THE "PROOF OF CLAIM" FORM DIRECTLY TO THE COURT.
g. Class Counsel believe that the proposed settlement is fair, reasonable, and
adequate, and entered into the settlement only after weighing the benefits of the settlement
against the probabilities of success or failure. Class Counsel will submit to the Court a request
for an award of reasonable attorneys' fees not to exceed $2,800,000, plus reimbursement of
litigation expenses. ERACC, ELRAC and ELC intend to contest the fee and expense request.
The actual amount of reasonable attorneys' fees and costs will be determined by the Court, will
be paid by ERACC, ELRAC and/or ELC, and will not diminish the class recovery.
5. Voluntary Dismissal of All Other Claims. Regardless of whether or not you are a
Settling Class Member, you may have claims against the Defendants that are not put to rest as a
result of the proposed settlement ("Unreleased Claims"). You are a Class Member with
Unreleased Claims if:
You purchased one or more of these products
from ELRAC in the State of New Jersey | Between and including the dates |
| CDW | 04/1/88 and 3/11/03 |
| SLP | 03/01/00 and 03/11/03 |
| PAI | 03/01/00 and 03/11/03 |
If the settlement is approved, the Court will dismiss all Unreleased Claims without prejudice.
You will retain the right to raise any and all Unreleased Claims in any appropriate forum and
under any appropriate procedure you wish. If you do so, the statute of limitations for raising
your Unreleased Claims will be tolled during the pendency of this class action to the full extent
provided for by New Jersey Law.
The court filing, depositions and non-confidential documents produced in this Action
will be retained by Class Counsel indefinately. You should be aware, however, that certain
confidential documents produced by the Defendants in the course of this Action will be retained
by Class Counsel under the terms of the Court's protective order for only 30 days after the
Settlement Effective Date, and will then be destroyed or returned to Defendants.
6. Hearing for Court Approval of Settlement. On November 8, 2004, at 1:30 p.m.,
this Court will hold a hearing ("the Hearing") in the courtroom of Judge Edward M. Oles of the
Superior Court of New Jersey, Ocean County, Law Division at the Ocean County Courthouse,
118 Washington Street, Toms River, New Jersey, 08754, to determine whether the proposed
settlement is fair, reasonable, and adequate and should be approved and the lawsuit dismissed in
accordance with the terms of the settlement. This Hearing may be postponed to a later time
without further notice. You will be represented at the Hearing by Class Counsel, unless you
enter an appearance in person or through your own counsel. It is not necessary for you to
appear at the Hearing or retain your own counsel to participate in the settlement. As a Class
Member you will not be personally responsible for attorneys' fees or cost disbursements, except
those of your own counsel.
7. Options for all Class Members. If you are a Class Member you have the
following options:
a.
You May Take No Action and Participate in the Proposed Settlement.If you take no action, your interests as a Class Member will be represented by the Class
Counsel at no cost. Class Counsel are:
Bruce D. Greenberg
Lite, DePalma Greenberg & Rivas, LLC Joseph N. Kravec, Jr.
Two Gateway Center, 12th Floor Specter Specter Evans & Manogue, PC,
Newark, NJ 07102 The 26th Floor, Koppers Building
Pittsburgh, PA 15219
Peter Russell Kohn
Berger & Montague, P.C.
1622 Locust Street
Philadelphia, PA 19103
If the settlement is approved by the Court and you are a member of the Settling Class, your
claims arising from or relating to the purchase of SLP and/or PAI during the applicable time
period will be dismissed with prejudice and you will receive the benefits of the proposed
settlement. If the settlement is approved by the Court and you are Class Member with
Unreleased Claims, your Unreleased Claims will be dismissed without prejudice.
b.
You May Object to the Proposed Settlement. You can object to the
proposed settlement by filing and serving a written objection stating (i) why you object to the
proposed settlement and (ii) whether you intend to appear at the Hearing (either personally or
through an attorney), and attaching any documents supporting your position. Your objection
must be signed and
must include the following information: the name of the lawsuit (
Delaney
v. Enterprise Rent-A-Car Company); the case number (OCN-L-1160-01); your full name,
current address, and telephone number. You should also identify as best you can the Enterprise
Rent-A-Car office from which you rented a vehicle and the date or dates of the rental. You
must submit any objection in writing by first class mail, postmarked on or before October 8,
2004 to Class Counsel, Joseph N. Kravec, Jr., Esquire, Specter Specter Evans & Manogue, P.C.,
The 26th Floor, Koppers Building, Pittsburgh, Pennsylvania 15219;
and Enterprise's Counsel,
Gregory D. Call, Esquire, Folger Levin & Kahn, LLP, 275 Battery Street, 23rd Floor, San
Francisco, California 94111;
and to Clerk, Ocean County Courthouse, 118 Washington Street,
Toms River, New Jersey, 08754. Any Class Member who does not serve objections in the time
and matter described above will not be permitted to raise these objections later.
8. For More Information. This Notice is merely a summary of the proposed settle-
ment, and does not describe all of the details. For full details of the settlement, you can review
the proposed "Settlement Agreement" that is available at www.ssem.com or may be inspected
during business hours at the office of the Clerk, Ocean County Courthouse, 118 Washington
Street, Toms River, New Jersey, 08754.
PLEASE NOTE: You do
not need to complete the Proof of Claim below or do anything at all if
you wish to participate in the settlement and you purchased SLP and/or PAI from ELRAC in
New Jersey from November 1, 1999 through February 29, 2000. Submitting a Proof of Claim
is required
only if you wish to participate in the settlement for purchases of SLP and/or PAI
from ELRAC in New Jersey from April 1, 1988 through July 30, 1993.
Proof of Claim
The deadline to submit Proof of Claim has passed on October 8, 2004.
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